Oil companies have cut petrol prices
by a steep Rs 3.05 a litre, excluding state taxes, with effect from Monday midnight, even as they raised diesel prices by 50 paise a litre.
Indian Oil Corporation (IOC) on Monday said the decrease in petrol price was due to appreciation in the rupee's value and reduction in international motor spirit (MS) prices.
"Decrease in petrol price has now become feasible because of reduction of MS prices and appreciation of rupee against the US dollar. Both these factors have resulted in the reduction of MS prices which is
being passed on to the consumer," the state-run oil company said.
In Delhi, the petrol price would decrease to Rs 72.40 per litre. In Mumbai, Chennai and Kolkata, petrol would now be priced at Rs 79.49, Rs 79.51 and Rs 75.68 per litre.
The three state-owned oil marketing companies had last raised prices of petrol by Rs 1.63 per litre on September 14. Diesel prices were hiked by 50 paise a litre September 1.
Defending the hike in diesel prices, IOC said "even after the current increase,
under-recovery on retail diesel shall stand at Rs 10.52 per litre."
Diesel prices in Delhi will be increased to Rs 52.54 per litre. In Mumbai, Chennai and Kolkata, diesel would now be priced at Rs 59.46, Rs 56.90 and Rs 56.01 per litre, respectively.
IOC added that it is closely monitoring international oil prices and rupee-dollar exchange rate, the outcome of both will be reflected in future price changes.
The government had deregulated petrol prices in June 2010. However, it subsidies the retail selling prices of diesel, kerosene and cooking gas to insulate domestic users from the impact of a rise in international oil prices and to contain inflationary conditions.
The state-run oil companies are expected to incur under-recoveries worth Rs 73,500 crore on sale of the three sensitive products while the three companies - IOC, Bharat Petroleum and Hindustan Petroleum - combined are predicted to incur Rs 1,39,600 crore of under-recoveries this financial year.
With inputs from IANS
Special 
